Term or Investment?

After the long weekend, I am back to Blogging. Sorry couldnt get much time to furnish my blog with information.

Recently, I help one of my client and her husband to do a Policy Summary. After completing the Summary, I re-explain the whole insurance thingy to him. I can say most of his policies are Trad type. Which is Endowment and Life.

Therefore I suggest to him to do a restructuring of his policies. Actually policies upgrading and updating is Important. Cos in the past, people are more conservative towards investment. However, now most of the people I know have either trading or investing. Which is the way to outbeat Inflation and really gain capital appreciation.

Now i understand most of the people either buy term invest the rest or getting a pure investment life policies. I always think that either way is correct. Cos Term plan is the cheapest insurance you can find, and you can use the excess money to do investment.

Example @ age 30 male non smoker if you only have a budget of $200 monthly,

Term Life covering LIFE till age 75 yrs old. The monthly premium is $120 monthly, the rest of the premium you can saved up first then do investment. (sound funny isnt it? In that case you will loose the opportunity costs)

For Investment Life covering Life for WHOLE LIFE, Critical Illness for WHOLE LIFE etc. If the monthly premium is $200, it can covers you around $100k for LIFE and Critical Illness.

The above is just an illustration. Premium varies and coverage varies for different ages and gender.

In the end, my client prefer the 2nd choice as he prefer the best of two world which gives him coverage and the potential return from the investment. Conclusion, constance contact and review with your consultant is important.